Certified Management Accountant (CMA)

Certified Management Accountant (CMA) is an accounting designation that signifies expertise in financial accounting and strategic management. This certification builds on financial accounting proficiency by adding management skills that aid in making strategic business decisions based on financial data.

The Institute of Management Accountants (IMA) issues the CMA certification.

CMAs have an extensive range of career options. They can move into executive positions such as vice president of finance, controller, chief financial officer, and chief executive officer. CMAs can specialize in many roles, such as staff accountant, cost accountant, corporate accountant, internal auditor, tax accountant, financial analyst, and budget analyst.

CMAs are subject to a code of ethics. The Freddie Mac scandal in 2003 is an example of management accountants not adhering to a code of ethics. Company executives and management accountants deliberately understated company profit. They also illegally used company resources for fundraisers for federal candidates to influence decisions about Freddie Mac. The actions were illegal and unethical and violated the CMA code of ethics.

CMA candidates must be active members of the IMA and have a bachelor’s degree or related professional certification and two years of continuous work experience in management accounting or financial management. They must also pass a rigorous exam.

Candidates should plan to study for 150-170 hours per part to prepare for the two-part CMA exam. Candidates are allocated four hours to complete the 100 questions and two essay questions in each part. 

Part one covers financial reporting, planning, performance, and control. It includes the following sections:

• External financial reporting decisions: 15%
• Planning, budgeting, and forecasting: 30%
• Performance management: 20%
• Cost management: 20%
• Internal controls: 15%

Part two covers financial decision making and includes the following sections:

• Financial statement analysis: 25%
• Corporate finance: 20%
• Decision analysis: 20%
• Risk management: 10%
• Investment decisions: 15%
• Professional ethics: 10%

Starting on January 1, 2020, the exam structure will change. Part one will cover financial planning, performance, and analytics and will include the following sections:

• Cost management: 15%
• Internal controls: 15%
• Technology and analytics: 15%
• External financial reporting decisions: 15%
• Planning, budgeting, and forecasting: 20%
• Performance management: 20%

Part two will cover strategic financial management and will include the following sections:

• Risk management: 10%
• Investment decisions: 10%
• Professional ethics: 15%
• Financial statement analysis: 20%
• Corporate finance: 20%
• Decision analysis: 25%

Live and virtual classrooms are available to candidates, as are retired exam questions and glossary terms. For more, see the IMA's CMA Exam informational page.

The hiring of accountants is projected to grow 11% from 2014 to 2024. Business and process changes are expected to continue to shape the management accounting sector. Due to the absence of standardization, growth is expected to continue in the management accounting sector because companies have considerable freedom in designing management accounting systems. Management accounting designs and processes vary significantly by company.

Additional factors that contribute to an increased demand for management accountants include staffing needs, a healthy economy, advanced business platforms, and globalization of businesses.

The Industrial Revolution prompted the need for superior cost accounting systems. The railroad industry influenced the accounting sector with financial statements, cost estimates, reports, and other metrics to help companies make informed decisions. The evolution of the railroad industry and the rapid growth of financial institutions shifted the focus of managerial accounting to include functions other than cost accounting, such as human resource accounting.

During the Industrial Revolution through the middle 1900s, corporations made huge investments in natural resources, factories, and equipment that resulted in the need for cost accounting. In addition, management accounting was used as cost accounting. After World War II, management accounting education was formalized when it was introduced into the curriculum of Master of Business Administration students at MIT and Harvard University. From the 1950s to the 1980s, the focus of the accounting industry shifted to providing information for management control and planning.